Creating a partnership-oriented, knowledge creation culture in strategic sales alliances: a...

Creating a partnership-oriented, knowledge creation culture in strategic sale...Eli Jones; Lawrence B Chonko; James A RobertsThe Journal of Business & Industrial Marketing; 2003; 18, 4/5; ABI/INFORM Globalpg. 336

An executive summary for managers and executive readers can be found at the end of this issue

Creating a partnership-oriented, knowledge creation culture in strategic sales alliances: a conceptual frameworkEli JonesAssistant Professor of Marketing and Director of the Program for Excellence in Selling, University of Houston, Houston, Texas, USA

Lawrence B. ChonkoHolloway Professor of Marketing, Department of Marketing,Baylor University, Waco, Texas, USA

James A. RobertsAssosicate Professor of Marketing and W.A. Mays Professor of Entrepreneurship, Department of Marketing, Baylor University, Waco, Texas, USA

Keywords Partnering, Sales information, Sales, Alliances, Management

Abstract Learning is at the crux of strategic alliance success today. The notion that alliances produce synergy implicitly means that alliance partners and employees must learn from the new environment created by the joining of two or more companies. Often, the sales force is overlooked in academic research concerning alliances. This is unfortunate, because the sales force is the "eyes and ears" for the alliance partners and can facilitate the learning process. Proposes a conceptual framework that captures learning at the interorganizational and individual salesperson levels. The research adds to the growing interest in organizational learning and strategic alliances, and it creates the groundwork for an interorganizational learning theory concerning the blending of two or more sales organizations.

Finding business partners Of the many characteristics a firm must take on to be viable in the twenty-first century, finding business partners - allies - has become increasingly important to be able to marshal the necessary resources needed to create and deliver value to their customers (Liedtka, 1996; Rackham and De Vincentis, 1999).

Customer value is the most important concept and the most important target in business management (Gale, 1994, p. 23).

Creating customer value is quickly becoming the focal point of business. Therefore, companies are discovering that they must devise new sales methodologies, which include partnering with other companies in a variety of areas in order to deliver value.

When customers' definitions of value change, a dynamic marketing organization is required to adapt to those changes (Slywotzky, 1996). Therefore, marketing strategy must be viewed as a process for responding to the changing needs of customers (Webster, 1994). This shift in strategic thinking has been termed "sense and respond" (Haeckel, 1995) - a mindset that emphasizes capabilitiesand relationships not products and transactions.

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One way in which organizations have attempted to respond to the changing marketplace, while simultaneously maintaining relationships with their customers and expanding their customer base, is through alliance formation. Alliances can provide many benefits to member companies (see Chonko, 1999; Whipple and Frankel, 2000). But they are not without risks, as noted by Kantor (1993) and Sankar et al. (1995).

While alliances with selling organizations have been around for several years (e.g. IBM and Hewlett-Packard with various hardware and software vendors), most of the academic literature concerning strategic alliances places little emphasis on the sales force. This is surprising since often alliances entail the blending[l] of two or more, sometimes very different, sales force cultures. Furthermore, the sales force can facilitate the learning process.

The purpose of this paper is to shed some light on the issue of forming strategic sales alliances and to propose a conceptual framework with learning at the heart of alliance success. Miles et al. (1999) call for a broadening of the focus on strategic alliances. They note that much of the alliance formation work has emphasized factors that might impact success. However, they also note, specifically, that little effort has focused on the overall performance of alliances. Following this call, our focus is on creating a partnership-oriented, knowledge creation alliance. We present and discuss a conceptual model drawing upon extant literature in organizational and individual learning. Our conceptualization emphasizes learning, which is the catalyst through which strategic alliances produce synergy and succeed. We conclude with managerial and research implications arising from our conceptual model.

There are three primary reasons for forming a strategic alliance between sales companies. They are:

(1) deployment (see Jones, 1995);

(2) growth (see Varadarajan and Cunningham, 1995); and

(3) learning (see Phan and Peridis, 2000).

Key drivers of success in strategic sales alliances are alliance structure, and the extent to which the sales compensation plan is aligned with the objectives of the venture and designed to motivate sales performance[2]. Our focus, however, is on the variables that impact learning and are associated with creating a partnership-oriented, knowledge creation culture in strategic sales alliances. In addition to organization-level variables typically researched in the strategic alliance literature, we add individual level variables, because it is the blending of sales cultures - comprised of independent salespeople - that can make the difference in alliance success.

Strategic alliancesStrategic alliances are long term, trust-based relations that entail highly relationship-specific investments in ventures that cannot be fully specified in advance of their execution (Phan and Peridis, 2000; Provan and Gassenheimer, 1994; Ring and Van de Ven, 1994). Alliances entail the pooling of skills and resources by the alliance partners in order to achieve one or more goals linked to the strategic objectives of the cooperating firms (Varadarajan and Cunningham, 1995).

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Strategic alliances

Conceptual framework

Key drivers

Relationship management

Blending cultures

Additional sales training

Perhaps the most important aspect of alliance formation is the heavy investment in relationships that must be undertaken (Gulati, 1995; Morris and Herbert, 1987; O'Farrell and Wood, 1999; Porter and Fuller, 1986). This includes people relationships as well as functional relationships. It is important to eliminate "hierarchy gaps", those that exist between top managers and line personnel as the alliance proceeds from planning to implementation stages. Joint meetings with members of both companies can help reduce this gap and, at the same time, create a partnership-oriented culture. Such meetings can be instrumental in establishing the tone for the upcoming partnership (Gulati and Westphal, 1999). As the newly formed teams establish working relationships, interactions can be expanded to include other individuals and units that will be impacted by the alliance. Companies that excel in managing relationships forged in alliances can gain a significant marketplace advantage.

As an additional note on relationship formation, relationship management will be a critical factor in efforts to create the so-called "virtual corporation" - the blending of the capabilities of multiple firms to take advantage of short-lived marketplace opportunities. The success of alliances boils down to the extent to which the alliance partners and employees have the expertise, processes, aligned goals and incentives, and philosophies needed to manage relationships - both internally and externally (Hutt et ai, 2000).

Much of the rationale for alliance formation involves the determination of the best way to expand a company's operations. While much is written about the benefits of alliances, there are also risks involved in alliance formation. These risks are rooted in how each individual organization operates and how their managers manage change (Kantor, 1989). If alliance activities cannot be separated from other organizational activities, there will be a need to mount a communications campaign to relate to alliance members how they will benefit from the alliance. For sales, this means compensation. This communication need will change how each organization operates. Further, organizations that pursue an alliance must be ready to adapt to needed changes.

There are very real problems in blending the cultures of two organizations. Variations in management styles, differences in size of allying organizations and misreading the marketplace are all considerations that must be managed for an alliance to be successful (Lei and Slocum, 1991). Different compensation plans between the two organizations must also be addressed. Alliances must create a distinct compensation package that fits the venture in question. Another potential drawback is that today's partners can become tomorrow's competitors. An alliance member can learn the business from its partner then enter the partner's industry as a competitor.

Effective sales alliance management requires additional sales training that emphasizes the importance of the alliance for both companies. Ettore (1995) observes that it is critical to extend such education beyond those immediately involved in the day-to-day operations of the alliance. This observation is, in part, based on the idea that the success of the alliance depends, to a large degree, on the intellectual capital and contributions of many members of the two organizations (Kerr and Ulrich, 1995). However, to date, the research on strategic alliances has concentrated on forms of governance and incentives with relatively less emphasis on its learning aspects (Phan and Peridis, 2000). Heretofore, it has been assumed that knowledge transfer takes place once the linkages are formed between partners to a strategic alliance (Simonin, 1999; 1997; Lei et al., 1997). In reality, however, management's role is to create a

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Learning entities

Facilitating change

Learning

learning orientation within both companies and between both companies as partners. A key dimension of this learning orientation is energizing people to act as partners in their own development (Miles and Snow, 1995).

Strategic alliances represent looser and therefore less obvious learning entities than individual organizations, but this does not mean that organizations cannot learn collectively (see Larsson et al, 1998). While the individual organization learns by changing its actual routines (Argyris and Schon, 1978; Levitt and March, 1988), a strategic alliance of two or more sales organizations can learn by changing its interorganizational routines and processes. Interorganizational (joint) learning can be viewed as the collective acquisition of knowledge among a set of organizations:

... symbiotically interdependent, yet semiautonomous organizations that interact to construct or modify their collective environment, working rules, and options (Astley and Van de Ven, 1983, p. 251).

Figure 1 is a model depicting the relationships among organizational- and individual-level variables to be considered in alliance formation.

Briefly, the model shows variables at both the organizational and individual levels affecting interorganizational (sales organizations 1 and 2) learning and salesperson learning.

Importance of sales organization learningSeveral reasons can be offered concerning the importance of studying learning organizations from the perspective of sales organizations. First, because salespeople are on the front line of organizations, they are in the best position to facilitate change (Weitz et al., 2001). Sales personnel are the primary contact point for the customer and are directly responsible for implementing the firm's strategies (Crosby et al., 1990). They operate at the boundary of sales organizations (Singh, 1993). Usually separated from the organization, they are autonomous business "owners" conducting business with limited supervision, deciding on ways to grow sales volume in their respective territories (see Jones et al., 2000). Furthermore, they perform nonroutine jobs, play multiple roles, require self-direction, and function under much uncertainty and conflict (Dubinsky et al., 1986). Therefore, learning can assist them in being effective performers in the face of these work conditions.

Second, learning is regarded as a key to competitiveness (e.g. Garrett, 1987). The concept of the "learning organization" has gained momentum as companies seek to develop systems and structures that make them more adaptable to change (e.g. Dodgsen, 1993). Increasing complexity of the new product development process, shorter product life cycles, transformation of production processes toward "lean" production, virtual sales organizations, strategic alliances, and the growing number of computer assisted innovations (such as sales force automation, efficient consumer response, and just-in-time systems (Anderson, 1996)) are affecting sales organizations. All of these changes increase the need for companies with sales forces to learn new strategies and implementation methods.

Third, learning is a dynamic concept, and its employment, in theory, focuses on the continual changing nature of companies. Further, learning is an integrative concept in that it serves as a foundation for integrative efforts within the company and between alliance partners. Therefore, researchers and managers need to discern how to facilitate learning in a sales organization so as to affect such integration and subsequent change



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Strategic renewal

Business performance

Logical culmination

initiatives. Sales and marketing integration is regarded as critical for effective sales performance (Cespedes, 1994).

Fourth, learning is an integral part of the strategic renewal of organizations (Crossan et al, 1999). Change and renewal place considerable demands on the learning undertaken by individuals. Renewal requires that organizations and individuals investigate and learn new ways of doing things, while continuously exploiting what they already know (March, 1991). Thus, change and renewal arecritical if sales forces are to avoid becoming obsolete (Colletti and Chonko, 1997) or to engage in a successful turnaround after having become ineffective (Harker and Harker, 1998).

Finally, there is the critical issue of how organizations manage the knowledge they have learned. Knowledge management is critical to the ability of an organization and its salespeople to adapt, survive, and behave competently in the face of change. Knowledge management integrates organizational processes by seeking to create data and information synergies to improve the innovative capacity of salespeople (Malhotra, 1998). Indeed, knowledge management is appropriately described as:

... obsoleting what you know before others obsolete it and profit by creating the challenges and opportunities others haven't thought about (Malhotra, 1999).

Inter/organizational learning and memoryGarvin (1993) defines a learning organization as an entity:

... skilled at creating, acquiring, and transferring knowledge, at modifying its behavior to reflect new knowledge and insights.

Scholars view organizational learning as a process that develops and adapts over time. They perceive organizational learning as linked with knowledge acquisition and improved business performance (e.g. Garvin, 1993). Slater and Narver (1995) refer to organizational learning as the development of new knowledge or insights that have the potential to influence behavior. Learning is presumed to facilitate behavior change that leads to improved business performance. In essence, organizational learning requires generation of new ideas that conduce to altering the way work is performed thus triggering organizational amelioration. This is particularly true when blending two or more sales force cultures.

A basic assumption of learning is that innovation and ideas occur to individuals, not organizations (Nonaka and Takeuchi, 1996; Simon, 1991). Knowledge generated by individuals is shared, though, and actions are taken and common meaning is developed (Argyris and Schon, 1996). In sales organizations, relationships become structured, and some individual learning and shared understanding among groups becomes institutionalized in the organization. A theory of organizational learning should consider both organizational and individual learning levels (Crossan et al., 1999). Indeed, learning in organizations is multilevel (Crossan et al., 1999).

Sales organization learning represents more than the simple sum of the learning of its salespeople. Individual salespeople come and go, but what they have learned does not necessarily leave with them. Why? Because organization systems, structures, routines, and practices have learning embedded within them. The process of institutionalization represents a logical culmination of learning and separates organization learning from individual learning. Institutionalization represents a way of leveraging individual learning. Organization systems and structures provide a context for learning. Over time, individual learning becomes less prevalent as prior



Organizational memory

History

learning is institutionalized. Generally, learning that is institutionalized has received at least a degree of consensus among intra- and interorganizational members (Crossan et al., 1999).

Some researchers have acknowledged that organizational learning is a critical determinant of strategic alliance success (Hamel, 1991; Inkpen, 1996; Phan and Peridis, 2000). The organizational learning perspective of strategic alliances focuses on how value is created through the enhancement of partner skills (Gulati and Nohria, 2000; Khanna and Gulati, 1998; Larsson et al., 1998).

Organizational memoryMoorman and Miner (1997) define organizational memory as collectively held beliefs, behaviors, or physical artifacts. It represents learned ways of thinking and pertains to learning from past successes. Organizations often use memory to filter market information. Several prior research efforts support the notion that organizations do have memories (e.g. Cohen and Bacdayan, 1994). Sales organizations collect, distribute, interpret, and store information. Routines, frames of reference, and structures that reflect the existence of stored knowledge are indicative of sales organization memories. For example, utilization of organizational formalization (use of explicit rules) and organizational inflexibility (use of unbending rules and procedures) - two leadership substitutes that moderate the impact of sales supervisory behavior (Skinner et al., 1990) -could result owing to the past successful experience (and thus organizational memory) of the sales organization.

The downside of organizational memory lies in history. While much past information can be stored, the experiences of those who actually participated in the events are much more difficult to capture (Levitt and March, 1988). Therefore, the organization may have a well-developed source of "success" behaviors. Such a storehouse of experiences, though, can limit the experimentation that occurs in the organization as salespeople find it easy to seek the precedent (March, 1991). The upside of organizational memory is learning arising from a strategic sales alliance can be stored for future reference, which benefits either or both sales organizations in the long-term (even if the alliance is dissolved).

Individual salesperson learningIn their discussion of success factors in strategic alliances, Whipple and Frankel (2000) refer to competence-based trust. They cite four sources of competence-based trust:

(1) specific competence - specialized operational skills and knowledge;

(2) interpersonal competence - an individual's ability to perform responsibilities and work well with others;

(3) competence in a business sense - a broad experience beyond a specific area of expertise; and

(4) judgment - decision making abilities (Gabarro, 1987).

Clearly, these four elements require learning and, as Brouthers et al. (1995) observe, most alliance failure occurs as companies adopt a "seat of the pants" style of learning lessons of alliances. Indeed, the largest barrier to success is organizational, involving culture and change (Kurt Salmon Associates Inc., 1993).



Alliance partners As Phan and Peridis (2000) observe, there is often tension that arisesbetween alliance partners as cultures are blended. This tension can be alleviated through the development of collective learning (Larsson et ah, 1998). Therefore, there is a need to examine learning strategies of the organization and its individuals (Leroy and Ramanantsoa, 1997). Understanding individual salesperson learning is crucial as salespeople (and employees in general) represent the starting point for learning in organizations. Only through learning can a salesperson's existing reality be changed. Salespeople must interpret and comprehend new ideas and new information before the ideas and information can be used as well as presented to others (Weitz et ai, 1986).

Salespeople develop cognitive maps (e.g. how to sell, who reports to whom, how to complete various kinds of reports) about the domains in which they operate. Such interpretation occurs in relation to the salesperson's environment. Salespeople's environments in which they function have an impact on these cognitive maps, which also serve as guides to what is interpreted from that environment. As such, sales personnel may well interpret the same stimulus (e.g. an announcement of the alliance by senior executives) differently.

Sales environment As the sales environment changes, institutional learning may becomeobsolete (Colletti and Chonko, 1997). Thus, there may be gaps in what the sales organization has learned and what it should do. As the gap widens, organizations place more reliance on individual learning (Brown and Duguid, 1991). Given that sales environments are rapidly changing, the challenge for sales organizations - particularly in an alliance - is to attempt to synchronize institutional learning (which tends to exploit past learning) with new learning, which occurs at the individual salesperson level (March, 1991). Based on the above literature review, we propose a nonrecursive relationship between interorganizational learning and memory, and salesperson learning. In other words:

PI. Interorganizational learning enhances salesperson learning, and vice versa.

After having established the importance of organizational and individual learning in an alliance, we now discuss some key antecedents to learning in this context.

Antecedents to interorganizational learning, memory, and salespersonlearningKey antecedents In this section, we briefly discuss eight key antecedents to

interorganizational learning and memory, and salesperson learning in an alliance setting. The eight variables are:

(1) organization and environment fit;

(2) established routines and procedures;

(3) value of learning and learning mechanisms;

(4) environmental turbulence;

(5) salesperson recognition of organizational needs;

(6) salesperson effectiveness and experience;

(7) reliance on organizational memory; and

(8) information supply.



Organizational variablesOrganization and environment fit. Fiol and Lyles (1985) assert that effective organizations are aligned with their environment. Nadler (1987) posits that organizations are more effective when their major components are congruent with each other and where there is a good fit among the environment, the organization, and its people. The organization "fit" that we describe here entails cultural compatibility and skill complementarity typically referred to in the strategic alliance literature (see Phan and Peridis, 2000).

Levels of performance ! When there is a good fit between a sales organization and its businessenvironment - leading to desired levels of performance - there is a strong chance that the prevailing organizational and individual salesperson learning models will be reinforced (Hayes and Allinson, 1998). Under these circumstances, lower-level learning is likely to occur, which is designed to | detect mistakes and correct them. However, in a strategic sales alliance, higher-level learning is more likely to occur. Fiol and Lyles (1985) assert that a crisis - perhaps the recognition that there is a need for an alliance - is necessary to move organizations to higher levels of learning. We propose that organization and environment fit leads to higher-level interorganizational learning in a sales alliance (as compared to each individual organization's learning).

P2. The greater the fit between an organization and its environment, the higher the level of interorganizational learning.

Implicit and explicit rules Established routines and procedures. Swierenga and Wierdsma (1992)describe organizations as a collection of implicit and explicit rules that prescribe the way in which its members should behave. As long as behavioral rules lead to desired results, there is little reason to change the rules (assuming that the rules promote ethical and cooperative behavior). In other words, organizational members learn to behave in accordance with the new rules. This kind of learning is low level, however, consistent with the lowest levels of organizational (Baldwin et al., 1997) and individual learning (Sinkula, 1994). Today, sales organizations operate in turbulent and complex environments (Anderson, 1996). As such, older behavioral models may not ! produce desired results. Sales organizations face the need for change in order to ensure competitiveness.

Modifying the rules of behavior requires learning on the part of the individual in an organizational environment that is conducive to change (Argyris and Schon, 1978). Clearly, individual salesperson learning is important to the overall sales organization - independently and jointly. Organizational learning represents more than the sum of what individuals have learned. Companies develop and maintain learning systems that influence company employees and are transferred to company employees. We propose that the more alliance partners rely on previously established routines and procedures, the less impact interorganizational and salesperson j learning will have.

P3. The greater the reliance on established routines and procedures for each alliance partner, the lower the level of interorganizational learning.

P4. The greater the reliance on established routines and procedures for each alliance partner, the lower the level of salesperson learning.

Value of learning and learning mechanisms. Learning is at the heart of a company's ability to adapt to a rapidly changing business environment. Learning essentially is the way an organization builds, supplements, and

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Competitive advantage

The trap of repetition

Dynamics of rapid change

organizes knowledge and routines around company activities (Dodgsen, 1993). It is the key to identifying market opportunities that others might not see. Learning is critical to exploiting those opportunities quickly (Prokesch, 1997).

A company develops a competitive advantage if it can learn better than its competitors and apply knowledge faster and more thoroughly throughout the business than competitors. Sales organizations would seemingly provide a large opportunity for obtaining knowledge. Many firms have encouraged their salespeople to engage in customer-oriented selling (Saxe and Weitz, 1982), which focuses on satisfying needs of customers through a coordinated set of activities that allow the sales organization to achieve its goals (McGee and Spiro, 1988). Salespeople with customer-oriented selling skills are expected to initiate, maintain, and grow long-term relationships with customers (Flaherty et al., 1999).

Being customer oriented represents a long-term commitment. If knowledge acquired by salespeople interacting with customers, however, is short term in nature (e.g. sales leads for the next three months, specialized knowledge to obtain monthly sales quotas), then what may be overlooked is the development of knowledge acquisition programs that are created with the understanding that knowledge is relatively inexpensive to replicate once it is obtained (e.g. updating customer records, determining profitability per territory).

Successful sales representatives can and do fall into the trap of repetition. To avoid such complacency, management's philosophy should be that some kind of improvement should occur with each subsequent contact with a customer or prospect, and this philosophy should be backed up by an appropriate compensation plan - one in which learning is rewarded. Thus, companies should demonstrate the value of learning and its potential impact on continuous improvement to the alliance. Fostering an organizational culture that does this is a means of infusing the importance of learning throughout a sales organization (Jackson et al., 1994).

P5. The greater top management's emphasis is on learning in the alliance, the higher the level of interorganizational learning.

P6. The more sales force compensation is directly tied to learning in the alliance, the more salespeople are likely to acquire new knowledge and insights and share this information with alliance partners.

Environmental turbulence. The dynamics of rapid change have required that organizations become increasingly dependent on learning to keep up with marketplace needs. From an organizational perspective, learning guides an organization's responses to changes in the business environment. In recent years, marketing strategy researchers have begun investigating three environmental turbulence characteristics pertinent to organizational change, strategic alliances, and business performance (e.g. Han et al., 1998; Jaworski and Kohli, 1993). These characteristics include:

market turbulence - the rate of change in the composition of customers and their preferences;

technological turbulence - the rate of technological change in the environment; and

competitive intensity in the marketplace.

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Learning literature

Cognitive skills

Empowerment

In the learning literature, the nature of the market environment is a critical factor (e.g. Baldwin et al., 1997). In general, in low environmental turbulence conditions, the perceived need for change and the need for new information are likely to be low, and low-level learning (e.g. employee development) may be acceptable. Alternatively, under conditions of high environmental turbulence, the perceived need for change, for information, and for higher-order learning is likely to be higher.

There appears to be a paradox. While strategic alliances are implemented more efficiently when there is minimum tension between the partners, knowledge creation is maximized when such tension is increased (Phan and Peridis, 2000). We propose the following:

P7. The greater the perceived turbulence in the business environment, the greater the need for interorganizational and salesperson learning.

Individual variablesSalesperson recognition of organizational needs. Training has long been proclaimed to be a key influence on the knowledge and capability development of salespeople (Walker et al., 1977). According to Streufert and Nogami (1989), differences in levels of training, intelligence, and experience may not be sufficient to explain why some people continue to perform well and others, who have been successful, begin to show declining performance. A possibility is that some people are better at recognizing changing work contexts and altering their behaviors (through learning) to cope with the change. Thus, the ability to recognize change, in concert with the training, may well contribute to these individuals' sales success. Streufert and Nogami (1989) further assert that diverse situational demands must be independent of task-specific variables such as knowledge and skill. These variables control how a person perceives, processes, and organizes information and ultimately behaves.

P8. The more salespeople recognize the need for the overall alliance, the more likely they are to engage in higher order learning.

Salesperson effectiveness/experience. Research in the area of sales experience and learning is relatively clear (see Sujan and Weitz, 1994). For example, Szymanski (1988) suggests that more experienced salespeople use procedural as opposed to declarative knowledge - the latter being a lower learning form. Using script theory, Leong et al. (1989) find that more effective salespeople provide more elaborate, distinctive, contingent, and hypothetical scripts than do less effective salespeople. This suggests that highly effective salespeople have more developed cognitive skills to anticipate customer responses and proactively prepare appropriate ways to meet customers' needs and overcome customer objections. Their cognitive ability stems from stored knowledge based upon sales experience, which ultimately leads to higher-order learning. Thus:

P9. The more effective salespeople are, the more likely they are to employ higher levels of learning.

Reliance on organizational memory. Empowerment encourages informationsharing among individuals (Bowen and Lawler, 1992). It also encourages decision making at the lowest levels of the organization (Lawler, 1994). Johnson and Paper (1998) examined the relationship of empowerment and organizational memory, asking how empowerment leads to valuable organizational memories and how organizational memory can facilitate empowerment. They found that teams in organizations that are involved in

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Supply of information

Catalyst for research

memory activities (storage and retrieval of information) and that empower their workforce, learn from previous mistakes and successes by retrieving organizational memory. However, this process results in lower-level learning. Analyzing job failures and successes has been suggested as a means of getting sales personnel to work "smarter" (Weitz et al., 1986). Organizations thatempower their workforces rely on market forces to enhance their learning.

P10. The less salespeople rely on previously established organizationalmemory, the more they employ higher-levels of learning in an alliance.

Information supply. Lipshitz et al. (1996) suggest that one means of assessing learning organizations is with organizational learning mechanisms. These are structural and procedural arrangements (e.g. feedback from channel members, communication among sales force members, industry exhibitions) that allow organizations to collect, analyze, store, and retrieve information relevant to the detection and correction of mistakes (Popper and Lipshitz, 2000). Logically, sales organizations would seemingly have a built-in learning mechanism in their sales forces. This is because salespeople are in constant communication with customers, prospects, competitors, and other constituents, which affords them opportunity to acquire a surfeit of information. Thus, alliances that employ salespeople are in a unique position to participate in this information collection process.

As the supply of information available to salespeople increases, some information is actively acquired and some is passively acquired. Like organizations, some salespeople will actively search for information to solve problems. Active learners may change sales strategies and be more amenable to change in general. Others, however, might simply accept whatever information is easily accessible, not engaging in active search for new information. One of the benefits of an alliance is the active learning that takes place by empowering front-line employees (e.g. salespeople) to gather market intelligence. Creating this benefit means that alliances must allow salespeople to use their creativity in data collection, not hindering the process by providing too much information. This latter point is akin to creating information overload. How salespeople acquire information has ramifications for salesperson knowledge and organizational learning. Thus,

PI 1. The more information is provided by the alliance partners, the more salespeople engage in lower levels of learning.

P12. The more salespeople are involved in designing information systems within an alliance, the more salespeople engage in higher levels of learning.

ConclusionWe have sought to provide a catalyst for research in the area of alliance formation success through individual and organizational sales force learning. Heretofore, learning has been ignored in the strategic sales alliance literature. Our goal was to demonstrate the importance of learning in alliances, and uncover the determinants of interorganizational and salesperson learning. Twelve propositions arose from a review of existing literature and inductive reasoning involving the sales force. Our intent was to spark ideas and set an agenda for future research concerning knowledge creation in strategic sales alliances. Along the way, we discussed how individual and organizational learning coincide to produce one of the main benefits of alliances: synergy.



Economic necessity

Alliances represent a major change in the functioning of organizations. Too often, managers neglect the sales force while forming and maintaining strategic alliances. However, in a normative sense, the sales force should be a critical factor in strategy making. From a learning perspective, it is the sales force that is the "eyes and ears" for the alliance. Intelligence gathered by the sales force can facilitate interorganizational learning. Therefore, managers must remain cognizant of the importance of the sales force in this regard.

Investigation of the issues presented in this paper potentially would add to the growing body of research on organizational learning and strategic alliances and create the groundwork for an interorganizational learning theory concerning the blending of two or more sales organizations. Both salespeople and sales organizations learn if, through their processing of new information, their potential behavior is changed (Huber, 1991). We emphasized organizational and individual learning for two reasons. One is that learning must be shared if its potential to affect behavior and results is to be realized. A second reason is that when an individual learns by way of information acquisition and processing, that person takes on the potential for behavioral and results changes.

From a managerial perspective, salespeople must be ready and willing to drop old ideas and adopt new ones if, in fact, the new ideas carry the promise of improvement and growth. Of course, in order to adopt such a learning model, sales organizations must be prepared to go beyond traditional sales training and education. Investment demands necessary to build capabilities required to respond to future challenges currently are, and will continue to be, placed on sales organizations. Training to meet present and future needs, as well as new policies resulting from the alliance, represents such an investment. Building competencies for the future represents a considerable challenge, as the competencies must be accurately predicted; the costs and benefits associated with building those competencies cannot easily be computed.

Today, investing in the competence of an organization's people to achieve interorganizational learning is an economic necessity. A key role of the sales function is to gather market intelligence. The nature and quality of the sales force's dialogue and relationships with customers, peers, and supervisors - from a knowledge and learning perspective - are the core assets and capabilities of a market-focused sales organization (Day, 1994). In these types of alliances, learning represents much more than the absorption of information. Salespeople must share their newly found learning with alliance partners. For organizations and individuals engaged in higher-order learning, the emphasis is on knowledge generation and creation processes.

Salespeople and sales managers must know what data to collect, how to collect it, how to analyze it, and how to obtain the data in the normal course of their daily activities, so that the processes of data collection, selling, developing relationships with customers, presenting new products, servicing accounts, etc. are all seamless. An emphasis on learning adds to the effectiveness of the overall alliance. We hope that this paper inspires further research on how learning and change occur in strategic sales alliances.

Notes

1. Our use of the term "blending" applies to various forms of strategic alliances. For example, blending can mean two or more sales forces "merged" into a new sales force, or two or more independent sales forces that continue to operate independently but



cooperate wherever possible (e.g. a specific joint venture). Thanks to an anonymous reviewer for this comment.

2. Thanks to an anonymous reviewer for this comment.

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